Tuesday, November 29, 2011

Big Business is NOT Creating Jobs; Corporate Tax Breaks are a Huge Waste of Money

Republicans keep telling us that only the private sector can create jobs. They claim, time and again, that reducing corporate tax rates and giving huge tax breaks to big corporations creates jobs. Maybe, once upon a time, there was a degree of truth to the idea. In today's economy it's pure bunk.

I'd like to share a recent example from here in North Carolina. Apple built a new, huge new data center here. How many jobs did that create? A whopping 50! That's right, there are only 50 new jobs there. Let me quote from an article on Yahoo! Finance, which is originally from Business Insider:
"Apple has chosen to manufacture its products where it can manufacture them most efficiently--outside the U.S. And Apple's shareholders are benefiting accordingly.


But the point is that the hope that a few more companies like Apple, Google, and Amazon will restore the U.S. economy to its former glory is misplaced.

The companies create amazing products and vast shareholder wealth, but they don't spread this wealth around as much as earlier industrial giants did."
Please note that I deliberately chose an article from a business publication, not a left-leaning political site. It seems even business reporters can see the truth now.

So, how can we create more jobs in this country? It's not all that hard: you hire people. It worked for FDR in the 1930s and it can work now. No, government hiring for public works projects didn't end the Great Depression, but it did reduce unemployment from nearly a third of the workforce down to 12%.

First, start by rehiring the teachers, firefighters and police officers who were let go because of state and local budget cutting and the end of stimulus funds. The "Teachers and First Responders Back to Work Act of 2011", originally part President Obama's jobs bill, would have done that. It was blocked in the Senate by every last Republican, one independent (Joseph Lieberman) and two conservative Democrats (Bill Pryor and Ben Nelson). Polling shows that an overwhelming majority of Americans do not support the cuts to education and to first responders. The cost of the bill would have been $35 billion.

Second, rebuild our crumbling infrastructure in this country. Even the pro-business, conservative Chamber of Commerce endorsed President Obama's call for more investment in our nation's infrastructure. Once again, public support is there for repairing and building roads, bridges, the power grid, and other needed projects. Once again, the Republicans blocked the bill in the Senate. The cost would have been $60 billion.

Bare in mind that Republicans opposed closing tax loopholes on the wealthiest Americans to pay for these bills. I still have yet to hear a rational explanation from Republicans telling me how tax the breaks they defend for luxury yachts, private jets and second homes is good for the economy or will create jobs. I do know that employed people, whether in the public or private sector, spend money which helps businesses profit, creates more jobs and, in turn creates more consumer spending. Employed people pay a heck of a lot more in taxes than unemployed people too, which reduces the deficit. Coming back to my original point: corporate welfare, whether it's subsidies for oil and energy companies or tax breaks to build a new data center, are a huge waste of money which does nothing for ordinary taxpayers but does enrich a small slice of the top 1%. Corporate welfare also increases the deficit by more than enough to pay for the two jobs bills I referenced.

The plain fact is that Republicans are deliberately tanking the economy and killing job creation because they believe that people will blame President Obama and elect more Republicans next year. They are all about their own power and their wealthy and big corporate donors and to hell with the rest of us. Maybe, just maybe the Occupy movement is finally waking people up to that reality. Maybe instead of the "throw the rascals out" mentality we saw in 2010 we might just get the "throw the 1% and their lackeys out" mentality we really need. Maybe, just maybe, people will pay attention and put the blame where it belongs this time.

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